Invoice as a Consultant – Accounting Practices You Need to Know
The invoice template keeps on changing yet consultants are expected to stay on top of accounting through traditional excel sheets. Invoicing as we know it is changing into something smarter and quicker. With the influx of billing software, which are free of charge, the accounting space has opened itself to use by professionals who are not bookkeepers. This means people like consultants and freelancers, who have found accounting tough to handle, can carry out the tasks themselves.
Here are some fine accounting practices and tips that you absolutely need to know about.
1. Use Time Tracking
2. Personalize Your Invoices
3. List All your Billables
4. Add Payment Requisites with Dates
5. Offer Payment Channels
Time Tracking
In the consulting industry, time is money. As most consultants charge by the hours, they need to keep an accurate track of the time. Even if you are filing contracts on a project-to-project basis, time tracking can be a great tool for self-growth. Most invoicing software like the Cloudbooks come with a time tracking tool. This will record the hours you put in everyday for a project. This includes pretty much everything you do for the project. Time tracking software can add these billable hours to your weekly or monthly invoices. This is a must for consultants, especially because they often forget to record their hours.
Personalize Your Invoices
Also Read: An overall review of Online Invoicing Software- Link
Invoices are a literal representation of the work you put in to complete a project. They are supposed to serve as propositions as well as statements of work. Either way, a bit of branding never hurt anybody. In fact, it can be really good for your business. Always add a header in your invoice, with the appropriate branding. This means, your logo, address, name, and contact information. All these things should show up right on top of your invoice. Similarly, add the details of your client. Make sure to add correct information on every invoice. Double check and then make a template.
List All your Billables
This is one of the most important tips for consultants, building their own invoices. Make sure to track all your expenses and add them to your invoice. List each and every service that you provided to your client. You deserve to be paid for the work that you put in. And especially being a consultant, you will be providing services that might be not be included in your initial contract. Use an expense tracker for accurate service billing, and make sure you get everything you do on the paper.
Add Payment Requisites with Dates
Usually, when you prepare a contract, discuss and settle of some of the payment terms. These terms are generally understood. But an important and professional thing to do is to reiterate these terms on each invoice you are sending out. You should add the payment terms clearly on your invoice along with the due dates. If you follow a late payment policy, do not forget to add those details as well. For example, mention the fine on late payment.
Also Read: CloudBooks for Accounting- Link
Offer Payment Channels
The idea of sending out invoices is to get paid on time. Sometime you get a client, who is always procrastinating on payments, and giving you a date after another. So, people came up with certain ideas that will push your clients ever so slightly to pay. Offering payment channels right on your invoice is one of those slight nudges you can give to your clients for getting paid on time. You can list all the payment options with your account details on the invoice straight away for easy payments.
